Mainland firms to build plants abroad to ensure power supply

China has signed agreements to build power plants in Russia, Mongolia and Kazakhstan, and import electricity from them.

Experts said more companies were expected to invest abroad and transmit power back to the mainland in order to acquire cheaper resources internationally. They also warned that the projects could see neighbouring countries suffer from worsening pollution.

Liu Zhaoshao , chief economist of the State Grid Corporation, told a recent energy forum that it was negotiating with relevant parties and the deals were pending final approval from the National Development and Reform Commission, according to Xinhua.

In Mongolia, the preliminary plan is to build three power plants with an installed capacity of 3.6GW each. The first plant will begin operation by 2010. Most of the supply will go to Beijing, Tianjin and Hebei , while only a small part will serve Mongolia.

The State Grid Corp will build the transmission lines, while the construction of the plants may be carried out by Mongolian companies. The project in Kazakhstan will follow a similar pattern, while the power plants in Russia will be built by Russia.

Tang Ming, a chief economist with the Asian Development Bank, said it was natural for companies to seek cheaper resources globally.